Basic Terms
Intial amount of money put in?
What is Principal
A small share of a company that may increase or decrease in value?
What is a stock
Don't put all your eggs in one basket?
What is diversification?
A market where prices are going up
What is a bull market?
A payment you receive for owning a stock?
What is a dividend?
This is the profit/gain from the investment
What is ROI(Return on investmesnt)
A loan you give the government, which they pay you back along with more
What is a bond?
Spreading your money between different kinds of assets
What is asset allocation?
A market where prices go down?
What is a bear market?
The amount your money grows when you borrow or lend it?
What is interest?
The chance that you might lose money
What is risk?
A grouup investment where multiple people pool their money?
What is a mutual fund?
full collection of all of your investments?
What is a portfolio?
What's a market that's unpredictable, big ups/downs.
What's a volatile market?
When you sell something for more than you bought it for?
What is capital gain?
This means how quickly and easily you can access your money?
What is Lquidity
what does the investment type depend on company performance?
What is a stock?
This helps reducing risk via balancing stocks, bonds, and cash
What is asset allocation?
This market condition makes investing riskier?
What is market volatility?
When you sell something less than you bought it for?
What is capital loss?
This explains how small, consistent investments grow?
What is compound interest
in a mutual fund you don't control the exact investments chosen. this professional oversee where the money is invested?
What is a fund manager
This investment strategy adjusts assety allocation based on age or risk tolerance, often shifting from aggressive to conservative?
what is life cycle/target date investing
A bull market can mislead investors into buying high due to this effect, where people follow others?
What is a herd behaviour
If you sell an investment for capital gain this type of tax apply to how long you held it?
What is capital gains tax?